Faced with the idea of living an unknown number of years on a fixed sum of money, the prudent thing to do is conserve. However, you’ve worked decades to earn the opportunity to live a life of leisure, so conserving might seem to be a thorn in your side. The reality though, is crafting a spending plan will help you ensure you can enjoy your time, as opposed to worrying about overspending,

With that in mind, let’s take a look at these budgeting tips for retirees.

Assess Your Income

Before you can decide how much money to allocate to the various expenses you’ll encounter, you’ll need to know how much you’ll have with which to work. Take stock of all of your sources of income—Social Security, dividends from investments, pensions payments and the like.

Generally, a good rule of thumb is to plan for 70% to 80% of your current income. To get an idea of what that will be monthly, divide your annual take home pay by 12, hen determine how much 80% of it comes to. This will reveal the amount of cash you’ll need monthly.

Observe Your Current Spending Habits

How much are you paying for food each month? What does the bill for your utilities, water, garbage, cable and internet access run each month? How much are you spending to fuel your automobile? Remember Medicare payments and your telephone as well. These costs will remain constant, even after you retire, so you’ll need to have a solid handle on them.

You’ll no longer need to spend as much for shoes and clothes, nor their maintenance. The number of meals out will decrease each month as well. With these elements considered, you can compare your income to your anticipated expenses to get an idea of how well suited your income is to match your desired lifestyle.

You’re set if it looks like more will be coming in than going out. You’re going to have to make some adjustments if more is going to be flowing out than in.

Increase Income/Decrease Costs

You’re going to have to find ways to cut back expenses or ramp up your income if your analysis reveals you’ll be experiencing a negative cash flow. This could mean taking on a part-time job or finding ways to boost your income from home. Perhaps you can begin selling crafts or other products you can acquire inexpensively.

One of best ways to dramatically lower costs is move to a place with a lower cost of living. Texas is a popular state for retirees because it can offer both urban and rural experiences, along with good weather, no state income tax and a reasonably affordable cost of living.

Perhaps you can sell one or more of your cars as you enter retirement, since commuting to work will no longer be a requirement. Look for ways to save and invest more if you’re still working. Check with your utility/telephone company to see what discounts they offer seniors. You might even be in a position to change your phone plan, since you won’t need as much mobile data.

Eliminate Debt

Do everything possible to eradicate all forms of debt in your life. You’re going to need your dollars to go into supporting your lifestyle, rather than enriching lenders.

When it comes to debt relief, one of the best debt settlement tips for Texans, or any other state really, is to consider debt consolidation. This tactic can help you pay off your debts much sooner and at a lower cost. This is accomplished by combining all of your outstanding credit card debt into a single monthly obligation at a lower interest rate.

These four tips will help you determine how much you’ll need to budget for retirement. Having this knowledge beforehand can position you to take steps now to ensure your income will be sufficient.